John Rubino is a former Wall Street financial analyst and author or co-author of five books, including The Money Bubble: What to Do Before It Pops and Clean Money: Picking Winners in the Green-Tech Boom. He founded the popular financial website DollarCollapse.com in 2004, sold it in 2022, and now publishes John Rubino’s Substack newsletter.
Gold hit $3,000/oz last week.
I’ve been waiting a long time to write that sentence!
Now get ready for a torrent of gold miner cash flow to ignite a takeover boom. Mining analyst Marin Katusa just posted some thoughts on what this means. Here’s an excerpt:
Most gold mines have costs around $1,200–$1,400 per ounce. At current prices, miners earn profits of up to $1,800 per ounce. That’s huge.
Such generous margins allow producers to reinvest heavily in operational expansions or acquisitions, thereby driving increased M&A activity.
But Gold Miners Aren’t the Only Ones Stockpiling…
Physical demand is surging, and COMEX inventories are running low. That’s a recipe for even higher prices and more urgency for miners to secure supply.
The chart below tracks daily changes in COMEX gold stockpiles.
After a brief buildup in late 2024, inventories started shrinking fast in early 2025, a clear sign that physical gold demand is surging.
Miners facing higher input costs (fuel, labor, consumables) still see solid profit margins at $3,000 gold, making it easier to justify large outlays for new projects or company takeovers.
In fact, several gold miners are open to acquisition as long as the margin between AISC and the spot price remains above $1,000 per ounce.
The next chart illustrates how AISC margins have expanded across different price levels, showcasing why miners are in a strong position to deploy capital into acquisitions.
This margin cushion gives them an insurance policy against short-term price fluctuations. And allows them to engage in deals they might have shied away from when gold was below $2,000.
The result? Plenty of “war chests” for gold miners eager to snap up profitable, lower-cost mines in stable jurisdictions.
If these near-record margins stick around, analysts anticipate a string of “bolt-on” acquisitions. These are transactions that enhance existing portfolios with near-producing or producing assets.
For buyers, it’s about locking in future cash flow while prices are high; for sellers, it’s an opportune moment to exit at a valuation that factors in gold’s extraordinary margins.
In other words, $3,000 gold has made deal-making far less risky for both sides.
The margin cushion offsets potential cost overruns or operational hiccups.
As long as AISC remains significantly below spot, expect gold M&A to remain robust heading into 2025.
Glimpses of 2025: Rising Tensions, Rising Deals?
There’s growing geopolitical pressures…
A mix of lingering European conflicts, shifting trade alliances, and supply chain jitters which could elevate both gold and copper prices further in 2025.
Many insiders foresee more safe-haven gold deals, while copper remains the metal of choice for those targeting the energy transition.
Early signs include Equinox Gold Corp.’s $1.87 billion bid for Calibre Mining Inc., announced in February, reinforcing the idea that this M&A cycle is far from over.
What does it all mean for investors?
Without a single headline-grabbing megamerger, 2024’s data reveal an industry unafraid to seal smaller but numerous deals across multiple regions.
Gold stayed center stage, but copper’s second-half surge suggests a rising appetite for critical minerals too.
If tensions persist and commodity prices stay elevated, watch for another lively M&A season, one where gold and copper continue their tug-of-war for the top spot.
Commodities — Especially Gold and Copper — Will Be a Lot More Fun Going Forward
The big gold and copper miners in our Portfolio are reporting dramatically higher earnings and cash flow, bringing them to the attention of generalist investors. And the smaller players will draw the interest of the majors looking to put their growing piles of cash to work. Fun times all around! So keep adding to high-quality positions using low-ball bids, dollar-cost-averaging, and put writing.
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